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Costing MCQ Questions and Solutions with Explanations | Commerce

Costing MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Costing MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-2 section-12

Each section contains 100 MCQs on Costing .
11
The value of opening stock as on 1stJanuary 2003 was Rs. 7,000 stock of Rs. 23,000 in January were purchased. COGS was Rs. 21,000. What was the value of closing stock as on 31st January, 2003?
Discuss
Answer & Solution
Answer: Option D
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12
Three types of standards are . . . . . . . .
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Answer & Solution
Answer: Option A
Solution:
Current Standard:

It represents the standards set for the current period based on current conditions. These are practical and realistic, reflecting what can actually be achieved under existing circumstances.

Basic Standard:

A long-term standard that remains unchanged over a period of time. It is used mainly to measure trends over several periods and to analyze variances historically.

Normal Standard:

This standard represents the level of performance which can be achieved under normal operating conditions, considering average past performance and expected future efficiencies.

Incorrect Options:

- Option B refers to unrelated or nonexistent types of standards.

- Option C mentions "actual" and "estimated" standards, which are not recognized categories in cost accounting standards.

- Option D combines “expected” and “ideal” standards inaccurately; while ideal standards exist, they are not part of the classic three types (current, basic, normal).
13
Equivalent units represent the production of a process in terms of . . . . . . . . units.
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Answer & Solution
Answer: Option A
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14
Administration expenses are mostly . . . . . . . .
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Answer & Solution
Answer: Option C
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15
For conducting . . . . . . . . workers are studied at their jobs and all their movements and motions are noted.
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Answer & Solution
Answer: Option B
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16
When the debt turnover ratio is 4, what is the average collection period?
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Answer & Solution
Answer: Option C
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17
In transport costing . . . . . . . . charges vary more or less in direct proportion to kilometers run.
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Answer & Solution
Answer: Option A
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18
Raw material purchased:
1st January, 600 units @ Rs. 12 per unit
12th January, 500 units @ Rs. 14 per unit
21st January, 300 units @ Rs. 13 per unit
Raw material issued for manufacture:
3rd January 300 units
5th January 124 units
15th January 250 units
16th January 300 units
Raw material returned to stores from manufacturing department on 14th January, 50 units. The material is issued on First-in-First out method.
The value of material remaining in store on 21st January will be:
Discuss
Answer & Solution
Answer: Option C
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19
Which one of the following is not correct with reference to standard costing?
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Answer & Solution
Answer: Option C
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20
Match the following.
List-I List-II
a. Labour cost variance 1. Actual hours paid (Standard rate - Actual rate)
b. Labour rate variance 2. Standard cost - Actual cost
c. Efficiency variance 3. Idle hours × Standard rate per hour
d. Idle time variance 4. Standard rate (Standard hours - Actual hours worked)
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Answer & Solution
Answer: Option D
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